USD/NOK – Dollar remains strong

We have been pretty bullish on the Dollar throughout the year and I believe Dollar has more strength to come.

Recently, we recently posted a trade idea on USDNOK as we saw the market was correcting in a 3 or 7 swing structure and we took advantage of this.

Lets have a look at a before short

21st June 2022 – 1 hour timeframe

We can see that wave 2 was correcting as a Zigzag and our entry is based on wave ((c)) = ((a)) from the extreme of wave ((b)). Therefore, our entry was at 9.87 and the invalidation for the trade was at 1.618% extension at 9.75.

The above screenshot shows that this trade was already triggered as it reached into the bluebox zone but we still had projected wave (iv) and (v) to complete this 5 wave sequence into wave ((c)) of 2.

22nd June 2022 – 1 hour timeframe

So we can see here, wave (iv) and (v) did take place and it was very much deep towards 1.618% – but the trade was not stopped out. We can see that the trade has been unfolding towards a 5 wave sequence into wave ((i)) of 3.

We have now taken 50% profits off the table and moved stoploss the same distance between the entry and 50% from wave ((b)) below the entry point. Therefore, the trade is 100% risk free.

Next step

We are waiting for price to complete a 5 wave sequence to the upside and reach 100% extension of wave 3 against 1. But prior to that we want to see price breaking the extreme of wave 1.